Gamasutra has published the second installment of Steve Fulton's history of Atari, the pioneering games company. In 20 pages he covers the golden years from 1977 to 1981, where the highlights include a range of coin-ops, the Atari Video Computer System (or 2600), the Atari 400/800 line of personal computers, and games such as Space Invaders, Asteroids, Centipede, Tempest and Star Raiders.

The Atari 800 was a fantastic machine architected by the late Jay Miner and others, who later repeated the concept to create the Amiga 1000.

IBM thought about buying the Ataris as the basis for its entry into the home computing market, but Atari's owner, Warner Bros, had already sabotaged the machine. As Atari founder Nolan Bushnell says:

Warner ... said, 'Not only are we not going to help third-party developers, we're going to sue you if you use our operating environment.' So everybody that wanted to get into the software business supported Apple over Atari. So basically Warner drove the coffin nail in the Atari 800, despite it having a clearly superior chipset, a better operating environment... We had a lot of innovations in the Atari 800 that became standard later on.

There's obviously a lot of wishful thinking in that: the Apple II (1977) owned the market well before the Atari 800 appeared, and the 800 lacked expansion slots. Another thing that didn't help was the huge success of Doug Neubauer's Star Raiders game, which was pretty astonishing for its time. People bought Atari computers just to run it. But as Fulton says:

Of course, the success of Star Raiders had a serious downside for the Atari home computer division: it solidified the industry misconception that the 400 and 800 were not serious computers.

Atari had contracted with a young programmer named Bill Gates to modify a BASIC compiler that he had for another system to be used on the 800. After that project stalled for over a year Al [Miller] was called upon to replace him with another developer. So, while Al is the only person I know ever to have fired Bill Gates, I suspect that rather than work on Atari BASIC, Gates was spending all his time on DOS* for IBM. Probably not a bad career choice for him, do you think?

The company that uses the Atari name today has no connection with the one that pioneered the video games business.....

* Bill didn't write DOS but he was heavily involved with providing DOS and Microsoft Basic for the IBM PC, launched in 1981.